China has had a bad year for investment in chip companies according to the China market research and consultancy company J W Insights.

In the first 11 months of 2024,  the number of new investment deals fell 35.9% y-o-y to 677 while total funding fell 32.4%. ChangXin Memory, the DRAM manufacturer, had the single largest investment at $1.48 billion and second largest was Unisoc at $824 million.

JW Insights also points out that, in Q3, the US semiconductor market overtook China’s semiconductor market. The US and China market each represent about 30% of the world market.

“The surge in demand for advanced computing chips and high-end memory products – driven by the IMG_0511-150x150.webpcurrent artificial intelligence boom – has been hindered by domestic supply chain restrictions in China, while the US has made massive investments in AI infrastructure,” says Han Xiaomin, general manager of JW Insights.

Government-backed funding now dominates semiconductor investment in China, says JW Insights,and the China government is pouring in more.

China’s first  ‘Big Fund’ for chips in 2014 was worth $19 billion. The second Big Fund launched in 2019 was worth $28 billion. The third Big Fund launched earlier this year was worth $47 billion.